The MoF also cancelled last week's auction which was scheduled for January 29, citing the same reason.

This comes after the recent emerging markets turmoil pushed yields on January 2028 bonds to record highs. "The Finance Ministry doesn’t want to send the signal that it’s comfortable borrowing at current rates,” Anton Nikitin at VTB Capital told Bloomberg.

The ruble has taken a beating along with other emerging market currencies recently. And we've already looked at some long term issues plaguing the Russian economy.

The country is too dependent on natural resources and shows symptoms of the Dutch disease — in which economies driven by commodities exports seeing their currencies get overvalued. That in turn hurts its own manufacturing sector by making imports cheaper.

Most recently, Russia's HSBC PMI fall to 48, showing that manufacturing is contracting.